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Join us for an exclusive joint event with BSI (British Standards Institution), on Wednesday 11 October, 12.00 – 17.10, where we will explore the challenges of working smart with disruptive technologies and intelligence.

In this masterclass, Dr Peter Bloom will share insights into his new innovative Research into Employment, Empowerment and Futures group (REEF) – the first of its kind in the world to focus on the future of empowerment in the age of robotics. Peter will ask how can the rapid technological advances in computing, robotics and communications that are revolutionising work and life, be empowering, rather than dis-empowering, for people and organisations?

BSI, Internet of Things (IoT) Business Development Director, David Mudd, will share his knowledge and perspective on the rapid technological advances in IoT devices and how IoT technology can transform businesses, in terms of organisational performance and customer experience; also the pitfalls, from minor operational inconveniences to huge potential liabilities and brand damage, and how to avoid them.

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Guest blogger: Dr Raquel García-García is lecturer in strategic management at The Open University Business School (OUBS). Dr Raquel García-García is leading the Business Network Breakfast Briefing on 12 September 2017. For more information, visit the OUBS website.

To speed or not to speed is the looming question in today’s time-competitive international markets

After studying the outcomes of foreign expansion for several years now, the speed at which companies internationalise their operations and the returns they obtain from doing so is one of the topics that interests me most. Time is key in the current business world, but can multinationals keep up the pace?

Multinationals have traditionally expanded abroad slowly and gradually, moving from neighbouring countries to more distant ones. IThis internationalisation model prevailed in the international economic landscape during much of the 20th century. However, in recent years some multinationals have managed to defy this traditional pattern by successfully expanding abroad at a dizzying speed.

Professors Mauro Guillén and Esteban García-Canal provide various examples of this latter type of company in their book Emerging Markets Rule. Specifically, they discuss the cases of BYD (China), América Móvil (Mexico), and Ocimum Biosolutions (India). Wang Chuanfu founded rechargeable battery manufacturer BYD in 1995. By 2008 the company was already the largest manufacturer of nickel-cadmium batteries, selling more than 500 million batteries a year around the world. Tapping into its technological expertise, the Chinese multinational also made a triumphant incursion into manufacturing electric vehicles. Another example of a company that has taken the international markets by storm is América Móvil. Established in 2000, telecommunications giant América Móvil turned owner Carlos Slim into one of the wealthiest people alive (according to Forbes magazine). The company has operations in 25 countries and is considered to be the leading provider of wireless services in Latin America. Around the same time Indian entrepreneur Anu Acharya set up Ocimum Biosolutions, which expanded relentlessly to become one of the indisputable leaders of the bio-IT industry. As of 2017 the multinational has ventured into the US, Europe, and the Asia Pacific region.

However, multinational companies coming from emerging markets such as China, Mexico or India are not the only ones that can reap the benefits of a rapid foreign expansion. In a recent study co-authored by myself and professors Esteban García-Canal and Mauro Guillén (Journal of World Business, 2017) we found that firms from the ‘old’ Europe can also keep up with new trends in internationalisation and profit from speeding their internationalisation process, thus providing some hope to the managers of established multinationals from developed economies whose global leadership has been challenged by newcomers to the international scene.

Relying on a sample of Spanish listed firms, our results show that the speed of internationalisation has a different effect on performance depending on the timespan considered. Whereas it fails to have a significant effect in the short term – that is, on accounting measures – it displays an inverted U-shaped pattern in the long term – namely, in the capital markets. This implies that managers should pay attention to both short- and long-term measures of performance to have more accurate estimations of the effect of a rapid internationalisation.

The U-shaped pattern found between speed of internationalisation and long-term performance highlights that some multinationals can actually benefit from a high speed of internationalisation. Nonetheless, it also warns managers that they need to be aware that there is limit to the positive relationship between the multinationals’ speed of internationalisation and their long-term performance. In other words, managers cannot speed up the foreign expansion of their firms ad infinitum without eventually experiencing a decline in their value in capital markets.

Additionally, the results of this study account for knowledge-based factors that can support or hinder a successful rapid foreign expansion, which managers should take into consideration when making decisions about the speed of internationalisation at their firms. Whereas technological knowledge might be helpful at first to boost the benefits of a rapid internationalisation, it may become detrimental beyond a certain speed. This is ultimately explained by the need of multinationals to adapt their technology to the characteristics of the host countries where they operate. Technology adaptation to foreign markets is hard and time-consuming. Attempting to do so in a short period of time is likely to lead to higher costs and failures.

The diversity of a multinational’s international experience also plays a pivotal role in the relationship between speed of internationalisation and long-term performance. In this regard, even though the prior exposure to diverse institutional contexts may limit the learning opportunities when speeding up the internationalisation, it also helps managers decide more rapidly the multinationals’ course of action, which eventually allows them to outweigh the setbacks of a rapid international expansion.

Time is precious, and even more so in the international business scene. Speeding up the internationalisation process can be a good idea for some companies. However, managers must be cautious before expanding abroad in a rapid fashion and assess whether they have the necessary tools to succeed in doing so beforehand.

Our Business Perspectives webinar on ‘Better Governance. Better Consequence’ took place on Wednesday 15 March 2017. If you missed the webinar or want to watch it again, it is now available to view on demand.

During our webinar we used sport as a metaphor to explore governance. We explored multiple facets of governance and how, in an ever changing world, sport and business have similar qualities. We also explained how lessons from sport may be applied across business. The webinar also included video highlights from our masterclass in London on 23 February.

Professor Simon Lee, Professor of Law and Director of the Citizenship and Governance Strategic Research Area at The Open University joined as our speaker. The webinar was facilitated by Peter Wainwright, MBA alumnus and Consultant at Askyra Ltd.

You can also share your views and comments about the event or topic by following us on Twitter @OUBSchool, using #OU_BP

During our masterclass in London on 23 February, Professor Simon Lee, Professor of Law at The Open University (OU), explored the links between governance and sport. Professor Simon Lee made the case that governance isn’t about being the referee, it’s about being the goalkeeper. Being able to take a step back from the central action allows businesses to anticipate potential risks and make a strategic plan.

Professor Lee used examples from the sport and business worlds to explain how:

Governance is an attitude of mind rather than a particular process;

Trust and responsibility are key to corporate governance success;

Anticipating change and making appropriate adaptations will stand businesses in better stead;

It is important to account for the fact there will always be situations businesses cannot plan for.

During the masterclass, Professor Lee was joined by Pete Winkelman, Chairman of MK Dons FC, who spoke about regulation in football, and Etienne Stott MBE, Olympic Gold Medallist (Canoe Slalom) from London 2012, who showed how the governance of his sport created the structure for success. Video highlights are available:

The complimentary webinar, from The Open University Business School, will use sport as a metaphor to explore governance. The one-hour online webinar will take place on Wednesday 15 March at 7pm (GMT).

During the webinar, we’ll explore multiple facets of governance and how, in an ever changing world, sport and business have similar qualities. We will also explain how lessons from sport may be applied across business.

The webinar will include video highlights from our masterclass in London on 23 February. We’ll draw on the contributions from our masterclass and further develop these discussion points during the webinar, and we invite you to contribute via our live online polls and Q&A forums.

Webinar panellists include Professor Simon Lee, Professor of Law and Director of the Citizenship and Governance Strategic Research Area at The Open University. The webinar will be facilitated by Peter Wainwright, MBA alumnus and consultant at Askyra Ltd.

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Guest blogger: Mark Johnson is a solicitor and company secretary helping charities, social enterprises and SME businesses to flourish. His company Elderflower Legal offers a range of support packages to help organisations with legal compliance, managing risk and good governance.

Corporate governance has received increased attention in recent years as a result of high-profile scandals involving abuse of corporate power and, in some cases, unlawful activity by corporate officers. Governance is all about the way the organisations are directed, controlled and held accountable to deliver their purpose over the long-term. The organisation’s practices and procedures should be organised so that the organisation achieves its mission and goals, whilst complying with the law and sound ethical practice.

Putting in place a well-defined and enforced governance structure can provide a structure which works for the benefit of everyone concerned, by ensuring that your organisation adheres to accepted ethical standards and best practices, as well as formal laws. However, it is important that the systems are proportionate to the size of the organisation and the risks it faces. We set out below our ten top tips for effective governance.

Positive benefits of good governance include:

People will trust your organisation (including members, service users, funders, suppliers and the public), leading to improved trading terms

The organisation will know where it is going

The board will be fully connected with members and wider stakeholders

Good and timely decisions will be made

The Board will be better able to identify and manage risks

The organisation will have greater resilience to cope with problems

The organisation should enjoy improved financial stability

In our experience, there are common areas that often cause difficulties for organisations. Here are our ten top tips for effective governance.

Mistakes at the start

When setting up a new organisation it is important to have a clear shared view of the vision and mission for the organisation. It is important to plan ahead and bring your supporters with you. Think carefully about your strategy from the start and articulate the vision continually to all your stakeholders. (A stakeholder is any individual or group who depends on the organisation to fulfil their needs and on whom the organisation depends).

Choose the right legal format and corporate structure

Think about what you want your organisation to achieve and choose the right format. Take professional advice and learn from what others have done. Don’t let the tail wag the dog. When selecting a legal format, form should follow function, structure follows strategy. First decide what you want to do, then choose the right structure which facilitates this. Don’t rush into setting up one particular format without understanding what the choices and implications are. It can be expensive to unravel the wrong choice. Professional advice is a sound investment.

Clarity of roles

There may be many roles in a complex organisation. It is important to have clarity about the responsibilities of the Board, individual directors, officers and managers. Write down the key responsibilities and draw up a structure chart and scheme of delegation so that everyone knows who is responsible for what and who has the authority to take decisions. Role descriptions should be easy to understand and new joiners to the organisation should be offered an induction. Roles and responsibilities should be reviewed annually, perhaps as part of an individual appraisal.

Poor Board performance

Board members may fail to perform effectively unless they have the right training and skills and a proper understanding of what their role is (in a documented role description). This can have a knock-on effect on the rest of the organisation, if it is not tackled effectively. There should be regular skills audits of the Board to ensure they are performing well. Group training session can be run to remind the Board of their role and continually improve their skills. A regular formal review of the Board’s effectiveness facilitated by an independent observer can be a useful tool for improvement

Recruitment and succession planning

You need to attract good people onto your board with a wide range of skills. If you have skills gaps and vacancies this can lead to ineffective performance or lack of scrutiny. Cast the net wide in looking for new and diverse talent and plan ahead to refresh the Board at regular intervals. Proper training and induction should be provided to would-be recruits to the Board. Allow them to attend a few meetings as an observer before taking the plunge.

Ineffective meetings

Regular meetings to enable a proper exchange of views are very important to good governance. In a fast world, where digital communication is becoming the norm, some of the nuances of physical meetings, body language and interaction can be lost. Meetings need to be properly run, with a clear agenda and board papers circulated in advance, at regular times and accessible venues. Attendees should not leave feeling unclear about what has been decided; concise minutes should be prepared and circulated promptly after the meeting. The Chair plays a vital role in running effective meetings, supported by a good company secretary.

Dominant founders

Sometimes the original founder of the organisation, a long-serving Chief Executive or Chair may have undue power or influence. Sometimes they may take on too much responsibility and spread themselves too thin. It is important to document the roles and responsibilities of key officers, including the limits on any delegated authority to make decisions (e.g. financial limits on payments, requirements for second signature etc). It is a good idea to write into the constitution a requirement for certain appointments to be refreshed every few years.

Mission drift

If an organisation starts to drift away from its core mission or principles, this can cause a sense of confusion and disengagement for board members, employees, members and customers. There could be a variety of reasons for this. Funding streams or contracts may encourage managers to move into new areas of activity. It is important for the Board to continually review whether the organisation is still fulfilling the objectives written into its constitution. The constitution may need to be reviewed and refreshed to cater for change and this will usually require the members to vote in favour of the change.

Engagement with members and stakeholders

Members and stakeholders need to feel that their voice counts and need to be kept regularly informed about the organisation’s activities. The board must be accountable to and represent the interests of the membership and service users effectively, otherwise a division can arise. This relies on transparent rules and reporting lines, as well as effective regular communication by the Board to keep all stakeholders informed. Members’ meetings should be appealing and easy to attend – think about possible incentives to get people to attend. Cadburys used to give away free chocolate to shareholders who attended its AGM!

Deal with conflict swiftly and decisively

Conflicts occur in most organisations from time to time. Unfortunately, disagreements can quickly escalate and cause rifts within the organisation as positions become entrenched. Conflicts are not always a bad thing- they can help to bring issues to the fore and lead to better debate. The Board, usually through the Chair, needs to deal with conflicts diplomatically, mediating between the different parties to achieve a positive outcome.

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Our Business Perspectives masterclass will take place on Thursday 23 February 2017 at 12:00 – 17:00 in London. Join Professor Simon Lee, Professor of Law and Director of the Citizenship and Governance Strategic Research Centre at The Open University and other leading experts, who will use sport as a metaphor to explore governance.

In this masterclass, Professor Simon Lee will base his presentation on latest current affairs in the sporting world. We will explore multiple facets of governance and how, in an ever changing world, sport and business have similar qualities. Professor Lee will also explain how lessons from sport may be applied across business.

In this session, you will broaden your knowledge on governance rules, structure and regulations, which may help you and your organisation improve ways of working.

The Open University in Scotland and Scottish Water are delighted to invite you to the twilight seminar: Business Legitimacy – Staying on the “right” side of public opinion – and how to avoid controversy.

This free event will be of particular interest to those in middle or senior leadership positions, in the public or private sectors, with an interest in influencing and maintaining internal and external, credible relationships.

Ever questioned what makes your business legitimate, or thought about how you navigate your business through challenges when its legitimacy is questioned? Want to stay on the “right” side of public opinion when facing adversity?

This highly thought provoking seminar will enable you to reflect on those complex questions in your own work environment and to share with others who have wrestled with the same dilemmas.

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Guest blogger: Professor Mark Fenton-O’Creevy, Professor of Organisational Behaviour and Associate Dean External Engagement, The Open University Business School.

And I am a weapon of massive consumption
And it’s not my fault it’s how I’m programmed to functionLily Allen, The Fear, 2009

The financial crisis that hit us in 2008 has been analysed in great detail by economists and journalists. A good deal of comment, including mine, has focused on the behaviour of bankers and traders. However this was also a crisis that was fueled by a bubble of debt fueled consumption. Perhaps we should be paying more attention to the psychology of consumer spending.

I want to delve into the emotional underpinnings of conspicuous consumption. Much of what I write below is illustrated more poetically in Lily Allen’s song, ‘The Fear’. At first, she appears to be singing a paean to conspicuous consumption and the relentless pursuit of a celebrity lifestyle, but as the chorus kicks in ‘I’ve been taken over by the fear‘; it become clear that this is a tale of the fear and emptiness that lies behind this impulsive consumption. This too is the story revealed by our research.

(Photo credit: Wikipedia)

Retailers, marketing agencies and even academic researchers in the retail marketing field tend to consider impulsive buying behaviour as either harmless fun or a positive social good; certainly as something which retailers should exploit and obtain financial benefit from. For example:

“Marketers need to understand such consumer behavior in order to formulate appropriate marketing strategy, allocate marketing budget below-the-line and design effective marketing tactics…… In such instances the acts may be normatively positive and leave the shopper feeling good”

Myself and Adrian Furnham collaborated with the BBC to launch The Big Money Test, which was launched on the BBC flagship consumer affairs television programme Watchdog. Around 110,000 people responded to the survey which looked at their emotional and psychological relationships with money.

We found that people who were high on impulsive buying behaviour tended to be people who had poor strategies for managing their emotions and were more sensitive to the highs and lows of positive and negative emotion. In other words it seems likely that for many people impulsive shopping acts as a substitute for more effective ways of managing their emotions.

If impulsive shopping helps people feel good, does that mean it is a problem? Surely, as many retailers would argue, this ‘feel good factor’ we get from shopping is a positive part of the ‘retail experience’.

The story is not that positive. We also looked at the relationship of impulsive shopping to financial outcomes. Those high on impulsive buying behaviour were much more likely to find it difficult to make ends meet and much more likely to suffer adverse financial events. The problem with the way that retailers target impulsive spenders is that they often have most success with those who are more likely to be financially vulnerable.

Are you or is someone you know an impulsive spender?

Do you think that there is too much pressure on people to spend, spend, spend; or is shopping just an enjoyable part of a modern lifestyle?

Join us to gain further insights and share your knowledge on this topic at our forthcoming complimentary Business Perspectives Festive Networking event on Thursday 1 December 2016 at 17:00 – 19:00. For more information and to register, please visit our website.

The Business Perspectives webinar on Strategy Matters in Turbulent Times: Think Big Data. Think Business Models took place on Thursday 13 October. If you missed the webinar or want to watch it again, it is now available to view on demand.

The one-hour webinar focussed on business models, strategic growth, digital strategy and big data. The webinar also included video highlights from our masterclass in London on 21 September.

Our webinar panellists included Professor Thomas Lawton, Professor of Strategy and International Management at The Open University Business School (OUBS), Jerry Teahan, Head of Strategic Business Development (Network, Cloud Services) at BT Group and Dr Hilary Collins, Lecturer in Management at OUBS. The webinar was facilitated by Peter Wainwright, MBA alumnus and Consultant at Askyra Ltd.

You can also share your views and comments about the event or topic by following us on Twitter @OUBSchool, using #OU_BP